In a landmark move that ends years of legal and political uncertainty, TikTok CEO Chew Shou Zi informed employees that the company has signed a binding agreement to sell its U.S. operations to a consortium of American investors. The deal, which has received the backing of U.S. President Donald Trump, effectively averts a looming nationwide ban in the U.S. and secures the platform’s future for its 170 million American users. The new entity, a TikTok U.S. joint venture, is set to close on January 22, 2026. The deal restructures TikTok’s ownership to comply with U.S. national security rules on data privacy and foreign influence. Under the new arrangement, a consortium of American and allied investors, including Oracle, Silver Lake, and Abu Dhabi-based MGX, will hold 50% of the U.S. entity, each owning 15%. Affiliates of existing ByteDance investors will hold 30.1%, while ByteDance, the original parent company, will retain 19.9%.
But the South China Morning Post adds that unresolved questions about its algorithm could remain a source of tension in the broader U.S.-China relationship, according to analysts. CEO Chew said that “the U.S. joint venture will be responsible for U.S. data protection, algorithm security, content moderation and software assurance. It will also have the exclusive right and authority to provide assurances that content, software and data for American users is secure.” Chew said the U.S. venture would oversee algorithm security by “retraining the content recommendation algorithm on U.S. user data to ensure the content feed is free from outside manipulation”. Sun Chenghao, Fellow at Tsinghua University’s Centre for International Security and Strategy, said the TikTok plan broadly aligned with market expectations, but its implementation remained uncertain as it would inevitably raise questions over control of TikTok’s core algorithm.
Gary Ng, Senior Economist for Asia-Pacific thematic research said that “there are uncertainties about the algorithm’s control and the relationship with the parent company. This factor may still be a point of ongoing conflict between the U.S. and China, especially before the midterm elections”. Shi Yinhong, Professor of International Relations at Renmin University in Beijing, said the deal also still needed the formal approval of the Chinese government.
